And in the category of econ drama, there’s this, after a mention of Romer’s argument that every dollar spent by the government created about $1.50 worth of demand:
Some economists say that’s too high. Valerie Ramey of the University of California at San Diego, initially thinking as a Keynesian, developed doubts after sifting through historical examples. During the military build-ups of World War II, the Korean War and the Reagan era, a dollar spent added roughly a dollar of growth, she says. Although Ms. Ramey supported stimulus in 2009 because the economy was so weak, she doesn’t advocate more now. “We just don’t have enough evidence to prove that it’s good.”
Cool. She changed her mind. But she’s still not arguing that stimulus didn’t work—she just doesn’t want to do more now.
“We just don’t have enough evidence,” Ramey said. Journal readers might be thinking the same thing.